57 S.E. 766 | S.C. | 1907
June 5, 1907. The opinion of the Court was delivered by This action was commenced in December, 1905, and was heard at the October-November, 1906, term of the Court of Common Pleas for Hampton *189 County. The plaintiff sought to recover damages for the alleged failure of the defendant to issue to him a ten year policy of insurance on plaintiff's life. The allegations of the complaint are in substance as follows: That on the fifth day of May, 1905, in consideration of the sum of fifteen dollars and forty-three cents, the defendant agreed to execute and deliver to the plaintiff its policy of insurance upon his life in the sum of one thousand dollars, and in case of plaintiff's death to be payable to his wife. That said policy was to mature in ten years, and at the end of that time, plaintiff, if living, would receive the sum of one thousand dollars, and in case of his death, the beneficiary would receive that amount; provided, the premiums were paid as they became due. That plaintiff paid the first premium and received a receipt therefor, stood his physical examination, and under the agreement above set forth, was accepted as an insurable risk by defendant. That although he has performed his part of the contract in full, defendant refused to issue said ten year policy, but instead wilfully and wantonly attempted to compel plaintiff to accept another policy of insurance by threatening plaintiff with imprisonment. The answer was a general denial. In rebuttal of plaintiff's testimony, defendant introduced in evidence the written application of plaintiff for a twenty year annuity in the State Mutual Life and Annuity Association of Rome, Ga. Judge Gage, the presiding Judge, having refused to direct a verdict for defendant, the case went to the jury, and a verdict for five hundred dollars was found for plaintiff. The defendant appeals.
The first alleged error is the refusal of the Court to direct a verdict for defendant, on the grounds: 1st. That there was no evidence that Mr. McKee was the agent of defendant company; 2d, that there was absolutely no element of damages shown. As to the first ground, we think the refusal of the presiding Judge was proper. It is well settled that where there is any evidence at all it must go to the jury. E.D. Rushton testified: "Do you know *190 who was the agent of the State Mutual Life Insurance Company of Rome, Ga., in Hampton County? Mr. McKee — J.W., or W.J. McKee — was the agent of the company. You had some dealings with the company? Yes, I have a policy in the company." On cross-examination testified: "From whom did you receive your information that Mr. McKee represented the State Mutual Life Insurance Company? Through Mr. McKee. In no other way? Yes, through policies I had to deliver for Mr. McKee direct from the house. You got all your information from Mr. McKee? I had communication with another agent. Who? W.G. Ruddell. Where is he? He was in Fairfax; I do not know where he is now. He is State manager for this same company." While it is true, mere declarations of a person are not proof of his agency, yet there is other evidence to warrant the question being submitted to the jury.
Nor are we prepared to say that in this case there were no actual damages. It is undisputed that plaintiff gave his note to the company, and that it is still an outstanding liability. True, plaintiff has not paid anything on the note, but the defendant refuses to give it up. In the application set out in the case, as in some applications, it was not agreed that the premium should be forfeited and go to pay the company for trouble and expense in issuing the policy if the applicant refused to accept the same when issued. It was, therefore, the duty of the defendant to surrender the note after the failure to complete the contract. This note was received as cash, and while outstanding, it, as it were, reduced the plaintiff's credit to that extent. We think the Circuit Judge was correct in holding this to be some element of damage sufficient to take the case to the jury.
Assuming, but not holding, that McKee was the agent of the company, and having power to bind it by contract, we proceed to consider whether the application for insurance *191
was a part of the contract of insurance and binding on the plaintiff. That the application is a part of the contract seems to be well settled by authority. Cooley, in his Briefs on the Law of Insurance, vol. I, page 676, says: "For the general purposes of construction, an application will be considered a part of the contract, if it is referred to in the policy in such a way as to indicate a clear intent to make it a part thereof." He quotes many cases supporting this view. Again, in the case of Lee v. InsuranceCo., 15 Fed. Cases, 158, 160, the following is found: "The rights of the parties are not ended or concluded with the making out of the application. When the application is made out and forwarded to the company, it is not a contract of insurance. It is only then that it has attained to the position of a proposal on one side, not accepted by the other. There is not a contract of insurance until the policy itself is delivered and accepted. * * * The authorities are uniform, I think, on that subject, and upon the authorities this application is not a mere preliminary representation, but it enters into and forms a part of the contract itself." See, alsoHopkins v. Hopkins (Ky.),
The final question for consideration is, whether or not punitive damages are recoverable in this case. We have above reached the conclusion that the application was a part of the contract. Therefore, this action is an action on contract, and unless fraud is alleged and proved, punitive damages cannot be recovered for the breach. The general rule is thus stated in Sedgwick on Damages (8th edition), section 603: "It may be considered to be established that the motives of the defendant in breaking his contract are to be disregarded, and consequently exemplary damages are not recoverable." In this State, however, in the early case of Bose v. Beattie, 2 N. McC., 538, the doctrine was suggested that where a breach of contract is accompanied with a fraudulent act, punitive damages are recoverable, but not for a breach unaccompanied *193
by fraud. This principle has been recently laid down as the law in the case of Welborn v. Dixon,
It is the judgment of this Court, that the judgment of the Circuit Court be reversed, unless plaintiff surrender all of the judgment except fifteen dollars and forty-three cents, the amount of the note given by plaintiff to defendant.